The nation's largest supermarket chain is waging a war on two fronts: cutting food prices at the same time it spends heavily in digital strategies designed to compete for customers who increasingly want to skip the trip to the store.

In a conference call with Wall Street analysts, Kroger CEO Rodney McMullen conceded the company's stock was taking a beating.

"I want to acknowledge that the team here at Kroger recognizes that we have our work cut out for us – as the market this morning points out," McMullen said. "We realize business transformations are hard, but I want to emphasize that we are on track to deliver on our Restock Kroger commitments."

The Cincinnati-based company has expanded parking lot pickup or home delivery to 91 percent of the households it serves. It is also beginning to build robotic warehouses across the country that will beef up home delivery further through a partnership with the U.K.'s digital grocer Ocado.

Kroger even has a pilot in Arizona with a robotic delivery driver filling home delivery orders.

Investing it tech and in lower food prices at the same time hit Kroger's fourth-quarter gross profit margin: shaving almost an entire point down to 22 percent. That was enough to evaporate $261 million in gross profit.

The supermarket retailer posted a $259 million profit, down 69 percent from $854 million last year (which was greatly helped by the Trump tax cut). Total sales hit $28.1 billion, down 9.5 percent (largely reflecting last year's sale of its convenience store business).